The Barclays chief executive, CS Venkatakrishnan, could have his maximum pay package rise by 45% to more than £14m, as part of a deal being considered by the bank’s board.
The high street lender is understood to have written to the bank’s largest shareholders regarding potential plans to overhaul its pay structures for Venkatakrishnan and its finance chief, Anna Cross.
The proposals, first reported by Sky News, involve a trade-off: cutting their fixed pay in exchange for being paid much higher bonuses. For the chief executive, that would mean slashing his fixed pay by nearly half from £2.95m to £1.59m, but allowing him to receive annual and longer-term bonuses worth up to eight times his new salary.
The move will take his maximum potential payout to £14.3m, up from a previous maximum pay package of £9.8m. That new upward cap, however, would require a huge jump in profitability – under a measure known as return on tangible equity – beyond the bank’s own current targets.
The decision is still being reviewed, with the remuneration committee due to outline any proposals in the bank’s annual report, which will be released alongside its full-year earnings on 13 February. Any proposals would then be put to a shareholder vote.
Barclays’ pay committee had come under pressure last year after an unnamed institutional investor reportedly called for a cut to the fixed-pay salaries to make up for the scrapped bonus cap.
The EU cap previously limited bonuses to two times bankers’ salaries, and was part of efforts to stamp out the kind of risky behaviour that was blamed for causing the 2008 financial crisis. Nevertheless, UK banks started to inflate the salaries of executives and high earners after the cap was introduced in 2014, to make up for their lost earnings potential.
UK regulators, who have also been under pressure to make the City more attractive to financial services firms, subsequently repealed the cap as part of post-Brexit rules in late 2023.
Barclays then became the first bank to officially lift the bonus cap for senior staff after shareholder approval at its AGM in May 2024, giving bankers the chance to receive up to 10 times their salary in bonuses. The bank has stressed that the decision to end the cap “does not alter the way Barclays sets its incentive pool, which is based on overall group performance”.
Commenting on the potential changes to executive pay, a spokesperson for Barclays said: “The remuneration committee meets with stakeholders throughout the year to gather feedback on our remuneration policy.
“Whether or not the committee chooses to propose any change to our current directors’ remuneration policy in 2025, the policy will continue to focus on rewarding sustainable performance, and close alignment with shareholders’ interests.
“The committee will publish their views and decisions in the 2024 annual report on 13 February.”
